The number of new claims for unemployment benefits dropped by 30,000 last week, marking the lowest level of jobless claims in over four years.
According to the Labor Department, jobless claims are now at a seasonally adjusted 339,000 — the lowest number since February of 2008, nearly a full year before President Barack Obama took office. Economists had expected jobless claims to rise to 370,000.
The number of people receiving unemployment benefits also fell by about 44,000 from the previous week, leaving a total of slightly above 5,000,000.
These new figures, along with the recently reduced unemployment rate, suggests that the labor market is continuing to get stronger. As economist Guy Berger told Bloomberg, the report “is consistent with a labor market that is gradually getting better… layoffs are at a low level and don’t seem to be going anywhere. Hiring is still very muted.”
Wall Street is reacting positively to the news, with stocks rising due to the hopeful signs.
Unsurprisingly, the right wing’s reaction has been more glum. Just as they did after the unemployment rate fell to 7.8 percent last Friday, some right-wingers are crying conspiracy in response to today’s good economic news. The current theory, voiced by Forbes’ Abram Brown (among others,) is that the numbers are so low because a large state — supposedly California — failed to report its quarterly figures.
In reality, as Business Insider’s Henry Blodget explains with the help of a source in the Department of Labor, all states were in fact included in this week’s jobless claims. It is likely, however, that some of the jobless claims in California were not processed in time to be included in this week’s report (which happens occasionally due to short staffing). Blodget’s source estimates this number to be about 15,000 to 25,000; these numbers will be added to next week’s report.
Even with the additional claims, the total number would be 10,000 to 20,000 claims below economists’ expectations. As Blodget concludes, “had all of California’s jobless claims been processed in time to make the jobless-claims release, this jobless number would still have been better than economists were expecting—but not as much better as it appeared.”
So it does appear that the labor market is making slow, steady gains. Still, don’t expect that to stop Jack Welch from speculating about Chicago’s latest attempt to steal the election by falsifying a sluggish recovery.
Copyright 2012 The National Memo